Apparently, we are still in Kansas. 

A subcontractor surety sued in Kansas state court by a general contractor and seeking to “get out of Dodge” removed the state case to federal court and then asked the federal court to transfer the matter to Washington state.

In fact, the roughly $500,000 claim against the surety dealt with a project in Tukwila, Washington. However, the underlying bonded subcontract called for litigation in the exclusive venue of the “Eighteenth Judicial District, District Court, Sedgwick County, Kansas.” The court decision reflects that the subcontractor was not a party to the litigation – only the surety had been sued.

The Kansas federal court first had to work its way past plaintiff’s motion for remand, asserting that the surety was bound to litigate in the state court forum – because the performance bond incorporated the terms of the underlying subcontract. The district court disagreed, noting that the forum selection clause in the subcontract – although “presumptively valid” – by its own terms did not apply to the surety. Rather, the clause spoke specifically and only to disputes “between Contractor and Subcontractor.” 

Turning to the surety’s motion for change of forum, the federal court (seeming intent to keep this case) was again unpersuaded by the mover. Weighing myriad factors – including: 

  • the suit against the surety could have been brought in Washington federal court in the first instance 
  • plaintiff’s choice of forum (according to the court, given “minimal” weight; although personal jurisdiction over the surety in Kansas was not discussed by the court, it is presumed that the surety does business in the state) 
  • relative congestion of Kansas court dockets versus Washington court dockets 
  • applicable law (Washington state law would be applied) 
  • cost of securing and accessibility of witnesses and evidence in Kansas concerning a Washington-state construction project 

The federal court nonetheless refused to transfer the case to Washington: 

“Defendant ‘has not identified any obstacles to a fair trial’ in Kansas. … And other than cursory allegations that witnesses and proof are located in Washington, defendant has not shown that litigation in Washington would prove ‘more easy, expeditious, or economical’ than litigation in Kansas. …

“In total, as they apply here, the factors produce a relatively close call. …But the governing legal standard requires defendant to demonstrate that the factors ‘strongly favor’ transfer of venue. … Defendant hasn't sustained that burden.”

Key Constr., Inc. v. W. Sur. Co., 2023 U.S. Dist. LEXIS 30475 (D. Kan. Feb. 23, 2023)